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Stocks of major pharmaceutical companies are likely to track their Jul-Sep earnings next week, and the counters of those announcing the quarterly result later will be in line with the broad market. Cipla Ltd is expected to post positive Jul-Sep earnings on Monday, riding on a robust growth in domestic sales and exports, and a weaker rupee, which should see its counter to react positively in the coming week.
Ranbaxy Laboratories, which is scheduled to release its September quarter earnings on Nov 8, is seen posting a net profit of 2.98 bln rupees backed by higher sales and market leadership in some of its drugs. However, profit booking may pull some pharmaceutical stocks down next week. The other companies scheduled to publish their earnings next week are Jubilant Life Sciences, Piramal Healthcare, Cadila Healthcare, Aurobindo Pharmaceuticals, Panacea Biotec, Plethico Pharma, and Natco Pharmaceuticals. The market will also keep an eye any development regarding the drug pricing policy, expected to be announced on Nov 24.
Growth in the sector is seen under pressure till the pricing policy details are out, and counters of multinational companies such as GlaxoSmithKline Pharmaceuticals, Pfizer Ltd and Abbott Pharmaceuticals are likely to take cues from the specifics outlined, India being one of their biggest market.
Last month, a Group of Ministers formed to decide the National Pharmaceutical Pricing Policy recommended that the weighted average price of all drug brands with over 1% market share in a segment should be fixed as the ceiling price of that particular drug. The move will bring prices of 348 essential drugs under government purview. The panel's proposals will be taken up by the Union Cabinet for approval.
